ZBRA » Topics » Discussion and Analysis

This excerpt taken from the ZBRA 8-K filed Nov 4, 2009.

Discussion and Analysis

For the third quarter of 2009, compared with the third quarter of 2008:

 

   

Net sales in all geographic regions were affected by lower economic activity, with relatively better sales performance in North America, which increased 13.2% from the second quarter of 2009.

 

   

Lower overhead absorption because of reduced volumes and a less favorable product mix contributed to a decline in gross profit margin to 45.7% from 48.3% a year ago. These factors were partially offset by the benefit of outsourcing and higher gross profit margin in the company’s Zebra Enterprise Solutions group.

 

   

Operating expenses declined from cost-reduction actions, which reduced overall employee-related compensation, travel and entertainment expenses and project expenses, in addition to lower expenses for amortization of intangible assets and exit, restructuring and integration costs. These reductions were offset by increases in general and administrative expenses for consulting and benefit costs. In addition, operating expenses for the third quarter 2008 include a non-taxable $5,302,000 reduction in operating expenses for the settlement of Zebra’s claim against the escrow for its acquisition of WhereNet Corp., and a $1,121,000 gain on the sale/leaseback of the company’s facility in Camarillo, CA, recognized as a reduction in general and administrative expenses.

 

   

Investment income totaled $901,000 for the third quarter of 2009, compared with an investment loss of $5,140,000, which included write-downs of $4,374,000 on securities and $2,897,000 on a long-term investment.

For the first nine months of 2009, net sales were $581,063,000, compared with $744,132,000. Net income for the year to-date was $29,474,000, or $0.49 per diluted share, including $9,455,000 in exit, restructuring and integration costs which lowered diluted earnings by $0.11 per share. For the same period a year ago, net income was $78,940,000, or $1.20 per diluted share, including $12,218,000 or $0.13 per diluted share in exit, restructuring and integration costs.

This excerpt taken from the ZBRA 8-K filed Aug 4, 2009.

Discussion and Analysis

For the second quarter of 2009, compared with the second quarter of 2008:

 

   

The decline in global economic activity continued to affect consolidated net sales, with consistent percentage sales declines occurring in all geographic regions. Product mix also had an effect on sales,

 

LOGO


 

with larger sales declines among high performance and midrange tabletop printers. Movements in foreign exchange reduced sales by $3,415,000, compared with 2009 second quarter sales.

 

   

Gross profit margin of 43.6% versus 50.3% a year ago was principally affected by the impact of the lower sales volume and unfavorable product mix. These factors were partially offset by higher profitability in the company’s Zebra Enterprise Solutions group.

 

   

Operating expenses declined $21,395,000, or 23.6%, from cost-reduction actions taken in the past twelve months, which reduced employee-related compensation, travel and entertainment expenses and sales support activity, in addition to lower expenses for amortization of intangible assets and exit, restructuring and integration costs.

This excerpt taken from the ZBRA 8-K filed May 5, 2009.

Discussion and Analysis

For the first quarter of 2009, compared with the first quarter of 2008:

 

   

Consolidated net sales were affected by the impact of declining global economic activity on business conditions. Sales declined on a comparable percentage basis in all of the company’s geographic regions, with the largest sales decline occurring in North America. Product mix also had an effect on sales, with larger sales declines among high performance and midrange tabletop printers. Unfavorable foreign exchange currency movements reduced first quarter sales by $6,739,000.

 

LOGO


   

Gross profit margin of 44.6% versus 49.9% a year ago was principally affected by the lower sales volume, unfavorable product mix and unfavorable foreign exchange rates. These factors were partially offset by higher profitability in the company’s Zebra Enterprise Solutions group.

 

   

Operating expenses declined $11,926,000 as a result of cost-reduction actions taken in the second half of 2008, in addition to lower commissions and amortization of intangible assets, and a decline in exit, restructuring and integration costs.

 

   

The effective income tax rate of 32.0%, compared with 34.5% a year ago, reflects the effect of lower quarterly income and a higher proportion of permanent tax adjustments.

This excerpt taken from the ZBRA 8-K filed Feb 17, 2009.

Discussion and Analysis

For the fourth quarter of 2008, compared with the fourth quarter of 2007:

 

   

Consolidated net sales declined 0.4%. A 3.1% sales decline in the company’s Specialty Printing Group (SPG) was substantially offset by growth of the company’s Enterprise Solutions Group (ESG) sales which increased by $5,729,000 primarily from the acquisitions of Navis and proveo in the second half of 2007. Sales to large customers in North America helped sustain sales growth of 3.6% in the region. Continued weakness in the Europe, Middle East and Africa region offset growth in the company’s Latin America and Asia Pacific regions.

 

   

Gross profit margin of 47.7% versus 48.5% a year ago was principally affected by unfavorable foreign exchange rates and product mix within SPG, offset by a favorable product mix associated with higher-margin sales by ESG.

 

   

Operating expenses before impairment charges and exit, restructuring and integration costs were substantially unchanged from a year ago. Although research and development expenses increased as a result of the acquisitions in ESG, they were offset by lower selling and marketing and general and administrative expenses from company actions to lower operating costs during 2008 by restructuring and streamlining operations.

 

   

Operating expenses were also affected by a $1,414,000 increase in the amortization of intangible assets from the acquisitions of Navis and Multispectral Solutions, and $7,791,000 in exit costs related to the company’s previously announced initiative to transfer final assembly of thermal printers to a third party; expenses for integrating operations in ESG; and severance and other restructuring charges.

 

   

During the fourth quarter of 2008, the company recorded non-cash charges of $157,600,000 following an impairment review in accordance with the Statement of Financial Accounting Standard (SFAS) No. 142 “Goodwill and Other Intangibles” and SFAS No. 144 “Accounting for the Impairment or Disposal of Long-lived Assets.” The charges were primarily attributable to impairment of goodwill and other assets recorded in connection with acquisitions in ESG in response to current and expected business conditions primarily in automotive and industrial manufacturing. The impairment also includes a charge for a reduction in the estimated value of RFID licenses, patents and other intellectual property related to SPG. The non-cash impairment charges do not affect the company’s ongoing business operations and will not have any impact on its compliance with debt covenants, cash flow or liquidity. The impairment charges will reduce the amortization of intangible assets by approximately $8,000,000 annually.

 

   

The income tax rate was affected by the impairment charges, a substantial portion of which were not deductible for income tax purposes.


This excerpt taken from the ZBRA 8-K filed Oct 29, 2008.

Discussion and Analysis

For the third quarter of 2008 compared with the third quarter of 2007:

 

   

Consolidated sales growth of 12.4% resulted from 3.5% growth in the company’s Specialty Printing Group (SPG) and $25,621,000 in sales from the company’s Enterprise Solutions

LOGO


 

Group (ESG). International sales increased 18.8%, with record sales in Asia Pacific and continued weakness in the Europe, Middle East and Africa region. North American sales increased 5.5%.

 

   

Gross profit margin of 48.3% was comparable to gross profit margin of 48.2% a year ago.

 

   

Operating expenses increased principally from acquisition-related additions of personnel and other expenses. The expenses were offset by a non-taxable $5,302,000 reduction in operating expenses for the settlement of Zebra’s claim against the escrow in its acquisition of WhereNet Corp., and a $1,121,000 gain on the sale/leaseback of the company’s facility in Camarillo, CA, recognized as a reduction in general and administrative expenses.

 

   

Operating expenses were also affected by a $1,783,000 increase in the amortization of intangible assets from the acquisitions of Navis and Multispectral Solutions; $2,570,000 in exit costs related to the company’s previously announced initiative to transfer final assembly of thermal printers to a third party; and $1,734,000 in expenses for integrating operations in ESG.

 

   

The company recorded a loss on investments of $5,140,000, which included write-downs of $4,374,000 for losses on securities and $2,897,000 on a long-term investment.

 

   

The provision for income taxes of $9,205,000 includes a $2,600,000 reduction because the WhereNet escrow settlement was not taxable.

For the first nine months of 2008, the company had net sales of $744,132,000, up 17.2% from $634,706,000 for the same period a year ago. Year-to-date net income totaled $78,940,000, or $1.20 per diluted share, including $12,218,000 in exit costs and integration expenses which reduced earnings by $0.12 per diluted share.

At September 27, 2008, Zebra had $246,857,000 in cash and investments, and no long-term debt. Net inventories were $106,261,000, and accounts receivable, net, were $171,928,000.

During the third quarter of 2008, the company repurchased 1,890,100 shares of Zebra Technologies Class A Common Stock to complete an authorization to purchase up to 3,000,000 shares. Zebra’s Board of Directors has authorized the purchase of an additional 5,000,000 shares of Zebra stock.

This excerpt taken from the ZBRA 8-K filed Jul 24, 2008.

Discussion and Analysis

For the second quarter of 2008 compared with the second quarter of 2007:

 

   

Consolidated sales growth of 21.5% resulted from 12.8% growth in the company’s Specialty Printing Group (SPG) and $25,020,000 in sales from the company’s Enterprise Solutions Group (ESG). International sales increased 28.0%, with record sales in the Asia Pacific and Latin America regions. North American sales increased 14.1%. Consolidated sales were affected by $5,009,000 in unfavorable adjustments from revenue hedging activities.

LOGO


   

Gross profit margin increased to 50.3% from 47.6%. Profitability was favorably affected by lower product costs, favorable changes in foreign exchange, and certain one-time items that accounted for 1.0 percentage points of the gross margin improvement.

 

   

Operating expenses increased from acquisition-related additions of personnel and other expenses, the implementation of annual merit pay increases, higher SPG marketing expenses and costs for two customer conferences.

 

   

Operating expenses were also affected by a $2,059,000 increase in the amortization of intangible assets from the acquisitions of Navis and Multispectral Solutions, as well as $4,680,000 in exit costs related to the company’s previously announced initiative to transfer final assembly of thermal printers to a third party.

For the first six months of 2008, the company had net sales of $500,059,000, up 19.8% from $417,488,000 for the same period a year ago. First-half net income totaled $53,170,000, or $0.81 per diluted share, including $7,914,000 in exit costs which reduced earnings by $0.08 per diluted share.

At June 28, 2008, Zebra had $270,148,000 in cash and investments, and no long-term debt. Net inventories were $101,339,000, and accounts receivable, net, were $179,081,000.

During the second quarter of 2008, the company repurchased 461,000 shares of Zebra Technologies Class A Common Stock under an authorization to purchase up to 3,000,000 shares. In the first six months of 2008, the company repurchased 1,490,600 shares of Zebra stock for $48,402,000.

This excerpt taken from the ZBRA 8-K filed Apr 23, 2008.

Discussion and Analysis

For the first quarter of 2008 compared with the first quarter of 2007:

 

   

Sales growth of 11.3% in the company’s Specialty Printing business unit and the sales contributions of its 2007 acquisitions fueled consolidated sales growth of 18.1%. International sales increased 31.8%, with record sales in the Asia Pacific and Europe, Middle East and Africa regions.

LOGO


   

Gross profit margin increased to 49.9% from 47.8%. Profitability was favorably affected by an improved product mix in specialty printers, better overhead utilization and a positive contribution from the company’s Enterprise Solutions business unit.

 

   

Expenses for sales and marketing, research and development, and general and administrative activities increased principally from the addition of personnel and other expenses related to the acquisitions of WhereNet, proveo and Navis in 2007.

 

   

Operating expenses were also affected by a $2,191,000 increase in the amortization of intangible assets, as well as $3,234,000 in exit costs related to the company’s previously announced initiative to transfer final assembly of thermal printers to a third party.

At March 29, 2008, Zebra had $306,284,000 in cash and investments, and no long-term debt. Net inventories were $89,443,000, and accounts receivable, net, were $171,862,000.

During the first quarter of 2008, the company repurchased 1,029,000 shares of Zebra Technologies Class A Common Stock under an authorization to purchase up to 3,000,000 shares.

This excerpt taken from the ZBRA 8-K filed Feb 25, 2008.

Discussion and Analysis

For the fourth quarter of 2007 compared with the fourth quarter of 2006:

 

   

The company had record sales in its North American and EMEA regions, along with high growth in Latin America. Sales from WhereNet Corp., which was acquired in January 2007, and proveo,

 

LOGO


 

which was acquired in the third quarter of 2007, supplemented sales growth. Revenue from Navis Holdings, LLC, which was acquired on December 14th, had a minimal effect on fourth quarter sales. Foreign currency translation also had a favorable effect on sales growth.

 

   

Gross profit margin of 48.5% increased from 46.9%. Profitability was positively affected by the higher sales volume, a favorable product mix and movements in foreign exchange translation, partly offset by increases to inventory reserves and warranty expense.

 

   

Expenses for sales and marketing, research and development, and general and administrative activities increased principally from the addition of personnel and other expenses related to the acquisitions of WhereNet, proveo and Navis. These increases were partially offset by the absence of an insurance receivable reserve, which was established in the fourth quarter of 2006.

For 2007, net sales advanced 14.3% to a record $868,279,000 from $759,524,000 for 2006. Net income totaled $110,113,000, or $1.60 per diluted share, versus $70,946,000, or $1.00 per diluted share, for the prior year.

At December 31, 2007, Zebra had $281,179,000 in cash and investments, and no long-term debt. Net inventories were $85,038,000, and accounts receivable, net, were $150,775,000.

This excerpt taken from the ZBRA 8-K filed Oct 22, 2007.

Discussion and Analysis

For the third quarter of 2007 compared with the third quarter of 2006:

 

   

All international territories achieved strong sales growth, with record sales in Latin America and Asia Pacific. The company’s North America territory achieved record sales with an improving growth trend. Sales from WhereNet Corp., which was acquired in January 2007, and Swecoin, which was acquired in October 2006, supplemented sales growth. Foreign currency translation also had a favorable effect on sales growth.

   

Gross profit margin of 48.2% increased from 47.1%. Profitability was positively affected by the higher sales volume and a favorable product mix, as well as improvements in manufacturing variances and movements in foreign exchange translation.

   

Consolidated expenses for sales and marketing, research and development, and general and administrative activities increased principally from the addition of personnel related to the acquisitions of WhereNet, Swecoin and proveo, which Zebra acquired in the third quarter of 2007. In addition, general and administrative expenses include $3,979,000, or $0.04 per share, in one-time charges related to the retirement of former CEO Ed Kaplan and Board of Director project activity related to the search and hiring of a new chief executive officer.

On a non-GAAP basis, excluding charges for stock-based compensation and the amortization of intangible assets, the company’s gross profit margin for the third quarter was 48.3%, compared with 47.2% for the previous year. Operating income on a non-GAAP basis was $44,726,000, or 20.6% of net sales.

For the first nine months of 2007, net sales increased 15.5% to $634,706,000 from $549,621,000 for the corresponding period a year ago. Net income totaled $79,310,000, or $1.15 per diluted share, versus $49,500,000, or $0.70 per diluted share, for the first three quarters of 2006.

At September 29, 2007, Zebra had $469,360,000 in cash and investments, and no long-term debt. Net inventories were $84,512,000, and accounts receivable, net, were $133,880,000.

 

LOGO


This excerpt taken from the ZBRA 8-K filed Jul 25, 2007.

Discussion and Analysis

For the second quarter of 2007 compared with the second quarter of 2006:

 

   

All international territories achieved record sales, with growth accelerating in Latin America and Asia Pacific. Moderated sales growth in North America from some project delays, and in the Europe, Middle East and Africa region from the timing of business, affected overall sales growth for the company. Sales from WhereNet Corp., which was acquired in January 2007, and Swecoin, which was acquired in October 2006, supplemented sales growth. Sales growth was also favorably affected by foreign currency translation.

   

Gross profit margin was 47.6%, compared with 47.8%. Profitability was favorably affected by improvements in manufacturing variances and movements in foreign exchange translation, offset by product mix and higher period costs.

   

Consolidated operating expense growth resulted from increases in expenditures for information systems, and professional engineering fees related to new product development work. The addition of personnel from the WhereNet and Swecoin acquisitions also contributed to higher operating expenses.

On a non-GAAP basis, excluding charges for stock-based compensation and the amortization of intangible assets, the company’s gross profit margin for the second quarter was 47.8%, compared with 47.9% for the previous year. Operating income declined by 1.8% versus a decline of 10.2% under GAAP accounting rules. Non-GAAP operating margin with the same charges excluded for the second quarter of 2007 was 19.1% versus 21.6% a year ago.

For the first six months of 2007, net sales increased 14.9% to $417,488,000 from $363,235,000 for the corresponding period a year ago. Net income totaled $52,349,000, or $0.75 per diluted share, versus $53,763,000, or $0.76 per diluted share, for the first half of 2006.

At June 30, 2007, Zebra had $495,075,000 in cash and investments, and no long-term debt. Net inventories were $79,478,000, and accounts receivable, net, were $124,584,000.

LOGO


This excerpt taken from the ZBRA 8-K filed Apr 30, 2007.

Discussion and Analysis

For the first quarter of 2007 compared with the first quarter of 2006:

 

   

The company reported high sales growth in its major geographic territories, including 20.1% growth in North America and 22.9% in the Europe, Middle East and Africa region. Strength in the company’s core business was supplemented by sales contributions from WhereNet Corp., which was acquired in January 2007, and Swecoin, which was acquired in October 2006. Sales growth was also favorably affected by foreign currency translation.

 

   

Gross profit margin increased to 47.8% from 47.0%. Profitability was favorably affected by improvements in manufacturing variances and product mix.

 

   

Results include an expense of $1,853,000 for acquired in-process technology associated with the acquisition of WhereNet Corp. in January 2007. This charge reduced earnings by $0.03 per diluted share.

 

   

Higher operating expenses resulted primarily from the addition of personnel from the WhereNet and Swecoin acquisitions. Increased expenditures in advertising, market development funding and information systems also contributed to operating expense growth.

 

   

Net income for the first quarter of 2006 includes a one-time positive adjustment of $1,319,000, or $0.02 per diluted share, for the cumulative effect of a change in accounting for the adoption of SFAS 123(R), Share-Based Payment.

On a non-GAAP basis, excluding charges for stock-based compensation, the amortization of intangible assets and expensing of acquired in-process technology that result from purchase accounting for acquisitions, the company’s gross profit margin for the first quarter was 48.1%, compared with 47.1% for the previous year, and its operating income increased by 20.9% versus an increase of 6.5% under GAAP accounting rules. Non-GAAP operating margin with the same charges excluded for the first quarter of 2007 increased to 20.5% from 20.1% a year ago.

At March 31, 2007, Zebra had $452,485,000 in cash and investments, and no long-term debt. Net inventories were $79,560,000, and accounts receivable, net, were $136,867,000.

This excerpt taken from the ZBRA 8-K filed Feb 14, 2007.

Discussion and Analysis

For the fourth quarter of 2006 compared with the fourth quarter of 2005:

 

 

·

High sales growth spanned geographies, products and channels. The North America, Latin America and EMEA regions achieved new quarterly sales records. Hardware sales increased 18.3%. Supplies sales increased 14.9%.

 

·

Gross profit margin declined to 46.9% from 50.0%. During the quarter, profitability was affected by higher material costs, adjustments to inventory reserves, and labor and overhead charges related to the start-up of new and expanded label conversion facilities in three locations.

 

·

The company took a pre-tax charge of $12,543,000 for the reserve of an insurance receivable that was related to the debt of a reseller customer. This debt was guaranteed by an insurance company doing business in the U.K. that defaulted on its guaranty obligation. Zebra has initiated legal action against the insurance company to enforce the guaranty.

 

·

Higher personnel costs from increased staffing to support planned growth, and increased expenditures on activities in information systems also contributed to growth in operating expenses.

For the full year of 2006, the company had net sales of $759,524,000, up 8.2% from $702,271,000 for 2005. Annual net income was $70,946,000, or $1.00 per diluted share. Results include the settlement and license with Paxar Americas, Inc., that was recognized in the third quarter, as well as the receivable reserve in the fourth quarter. For 2005, net income was $106,184,000, or $1.47 per diluted share.

At December 31, 2006, Zebra had $559,189,000 in cash and investments, and no long-term debt. Net inventories were $81,190,000, and accounts receivable, net, were $122,540,000.

LOGO


The company also announced that during the fourth quarter, it purchased 1.9 million shares of Zebra common stock against the 2.5 million shares authorized by Zebra’s Board of Directors. To date, Zebra has purchased 2.1 million shares under the current authorization.

This excerpt taken from the ZBRA 8-K filed Nov 1, 2006.

Discussion and Analysis

For the third quarter of 2006 compared with the third quarter of 2005:

 

  é High sales growth in international regions complemented an improving trend in North American sales. All major printer product lines contributed to this growth. Supplies sales increased 18.0%.
  é Gross profit margin declined to 47.1% from 49.8%. During the quarter, gross profit margin was affected by shifts in product mix and higher raw material costs.
  é The company paid Paxar Americas, Inc., $63,750,000 for the settlement of a dispute and a fully paid-up, perpetual, worldwide irrevocable license to certain patents owned by Paxar. Of this amount, $53,392,000 was expensed during the quarter. The remaining $10,358,000 relates to the acquisition of the license and will be amortized over a period of four to seven years.

For the first nine months of 2006, the company had net sales of $549,621,000, up 5.1% from $522,977,000 for the same period in 2005. Year-to-date net income was $49,500,000, or $0.70 per diluted share, compared with $79,339,000, or $1.10 per diluted share, a year ago.

At September 30, 2006, Zebra had $547,623,000 in cash and investments, and no long-term debt. Inventories were $82,072,000, and accounts receivable were $116,612,000.

This excerpt taken from the ZBRA 8-K filed Jul 26, 2006.

Discussion and Analysis

For the second quarter of 2006 compared with the second quarter of 2005:

 

    Ongoing strength in international territories with notable growth in the company’s Europe, Middle East and Africa region of 16.8% helped drive improved sales growth. On a consolidated basis, nearly all printer product lines contributed to a 15.6% unit volume increase. Supplies sales increased 19.1%.
    Gross profit margin declined to 47.8% from 50.5%. During the quarter, gross profit margin was affected by shifts in product mix, lower average unit prices, and unfavorable currency movements.
    Operating income benefited from a $2,068,000, or 3.8%, decline in operating expenses. This decline was largely the result of lower legal expenses.

For the first six months of 2006, the company had net sales of $363,235,000, up 4.6% from $347,342,000 for the first half of 2005. Net income was $53,763,000, or $0.76 per diluted share, compared with $51,264,000, or $0.71 per diluted share, a year ago.

At July 1, 2006, Zebra had $584,847,000 in cash and investments, and no long-term debt. Inventories increased to $77,369,000, primarily related to the implementation of the EU RoHS Directive to remove hazardous substances from electrical and electronic equipment. Accounts receivable were $115,693,000.

This excerpt taken from the ZBRA 8-K filed Apr 26, 2006.

Discussion and Analysis

For the first quarter of 2006 compared with the first quarter of 2005:

 

    All three of the company’s international territories experienced sales growth, with the Europe, Middle East and Africa region achieving record sales in local currencies. Nearly all printer product lines contributed to 12.5% unit volume growth, offset by lower average unit prices. Sales of supplies increased 14.6% for the quarter. Unfavorable foreign currency movements reduced first quarter sales by $5,405,000.

 

    Gross profit margin declined to 47.0% from 51.0%. During the quarter, unfavorable currency movements reduced first quarter gross profit by $4,855,000. The decline in gross margin also was due to a number of factors including: temporary capacity constraints in label manufacturing, new products currently undergoing ramp up and cost reduction, expediting costs for manufacturing materials to meet increased demand, mix shifts toward lower margin products, increases in material costs related to RoHS compliance, and various pricing actions focused on increasing market share.

 

    Operating expenses were affected by higher employee-related costs related to increased staffing in global sales and marketing and product development, offset by lower expenditures on legal activities, market development funds, consulting services, and audit and tax service fees.

At April 1, 2006, Zebra had $569,523,000 in cash and investments, and no long-term debt. Inventories totaled $66,605,000. Accounts receivable increased to $116,415,000 from $111,551,000, primarily due to the timing of shipments.

This excerpt taken from the ZBRA 8-K filed Feb 8, 2006.

Discussion and Analysis

For the fourth quarter of 2005:

 

                  International sales growth of 5.0% resulted from the effect of placing more Zebra sales representatives and other associates in high-growth regions to generate more business in those territories. Sales growth in the company’s Europe, Middle East, Africa region were affected by unfavorable foreign exchange rates. In North America, lower mobile printer sales to large retailers offset sales growth in non-retail sectors.

                  Gross profit margin of 50.1% versus 52.0% was affected by a mix-driven decline in average unit prices, higher warranty expense, and unfavorable movement in foreign exchange.

                  Quarterly operating expenses increased by 15.2%, primarily because of higher personnel costs supporting more business initiatives, product development expenses, and legal fees associated with intellectual property activities.

                  The income tax rate was 32.7%, compared with 34.3% for the fourth quarter of 2004. During the 2005 fourth quarter, income taxes were reduced by $875,000 from the recognition of job creation tax credits and the reversal of tax reserves resulting from the favorable resolution of certain tax audits.

 

At December 31, 2005, Zebra had $544,239,000 in cash, investments and marketable securities, and no long-term debt. Inventories totaled $63,638,000. Accounts receivable were $111,551,000 and were affected by the timing of orders and shipments during the quarter.

 

This excerpt taken from the ZBRA 8-K filed Nov 1, 2005.

Discussion and Analysis

For the third quarter of 2005:

 

                  The trend of slower mobile printer sales primarily to major retail customers in North America continued from the first half of this year. By contrast, sales benefited from ongoing high sales growth in the company’s Asia Pacific and Latin America regions as a result of the successful placement of Zebra sales representatives, sales engineers, and other support personnel in those territories to expand and strengthen customer relationships. In addition, sales reflect higher supplies shipments in North America from operational improvements, more effective sales strategies and the acquisition of label converting capacity on the West Coast that was completed in February 2005.

                  Gross profit margin of 49.9% versus 50.9% was affected by less efficient overhead absorption, increased distribution costs, and higher warranty expense.

                  Higher legal fees, personnel-related costs to support growth initiatives, and project expenses for product development contributed to a 13.0% increase in quarterly operating expense.

                  The income tax rate of 32.9%, compared with 34.7% for the third quarter of 2004, benefited from an $800,000 reduction in tax reserves following the resolution of tax audits.

 

Year-to-date net sales were $522,977,000, up 7.1% from $488,180,000 for the first nine months of 2004. Corresponding net income was $83,309,000, or $1.15 per diluted share, for 2005, compared with $88,682,000, or $1.22 per diluted share, for 2004.

 

At October 1, 2005, Zebra had $529,723,000 in cash, investments and marketable securities, and no long-term debt. Inventories totaled $63,684,000. Accounts receivable were $98,298,000.

 

This excerpt taken from the ZBRA 8-K filed Jul 27, 2005.

Discussion and Analysis

 

For the second quarter of 2005:

 

                  High growth in the company’s Latin America and Asia Pacific territories to record levels paced quarterly sales, which were moderated by slower growth in North America and the Europe, Middle East and Africa (EMEA) region, the company’s two largest territories. Quarterly sales growth was affected by a slowdown in shipments of mobile printers, compared with large shipments to major retail customers in North America and EMEA a year ago. In addition, deteriorating economic conditions reduced sales growth for the EMEA territory.

                  Gross profit margin of 50.6% versus 51.9% was affected by unfavorable foreign exchange movements, higher distribution and freight expenses, and less efficient overhead absorption.

                  Higher legal expenses and ongoing investments in personnel to support geographic expansion contributed to operating expense growth of 25.7%.

 

For the first six months of 2005, net sales were $347,342,000, an increase of 9.6% over $317,004,000 for the first half of 2004. First-half net income was $53,870,000, or $0.74 per diluted share, compared with $57,362,000, or $0.79 per diluted share, for the same period a year ago.

 

At July 2, 2005, Zebra had $573,810,000 in cash, investments and marketable securities, and no long-term debt. Inventories totaled $63,569,000. Accounts receivable were $104,999,000.

 

This excerpt taken from the ZBRA 8-K filed May 4, 2005.

Discussion and Analysis

For the first quarter of 2005:

 

                  All major product lines and geographic territories contributed to the 10.7% quarterly sales growth, with record sales achieved in the Europe, Middle East, and Africa (EMEA) region. Sales growth was affected by constrained capacity in EMEA distribution. This constraint was removed with the April opening of a new EMEA distribution center in Heerenveen, Netherlands, which is designed to support expected ongoing growth in the territory.

                  Gross profit of $87,365,000 includes total adjustments of $1,500,000 to the company’s warranty reserve and inventory reserve. These adjustments, which reduced gross profit margin by 0.9 percentage points, reflect the recent discovery of a variance in product specifications on an older, low-volume printer that is being discontinued, and the company’s decision to offer all users of this product a replacement unit.

                  Research and development expenses include $1,071,000 for a write-off of tooling and other materials related to product development.

                  Exit costs include $1,524,000 for additional reserves on a lease on a vacant facility in Wokingham, United Kingdom. The company recently reviewed the reserve on this lease, and because of a change in market conditions for this type of real estate, felt it was necessary to make the adjustment. Wokingham operations, which were acquired in the merger with Eltron International in October 1998, were consolidated into Zebra’s High Wycombe facility in 1999.

                  Operating expense growth, which otherwise was consistent with expectations, includes higher payroll and benefits expenses related to increased staffing in global sales and marketing, and product development. Higher legal expenses were largely related to ongoing litigation and intellectual property activities.

                  Foreign exchange had a minimal effect on financial results.

 

This excerpt taken from the ZBRA 8-K filed Feb 9, 2005.

Discussion and Analysis

For the fourth quarter of 2004, the company benefited from sales growth in all major product lines and geographic regions. All of the company’s international regions, which increased 20.6% overall, achieved record quarterly sales, with the highest percentage growth occurring in the Latin American region. The highest dollar sales growth occurred in the company’s North American region, which increased 17.2%. Gross profit margin of 52.0% increased 1.5 percentage points from the fourth quarter of 2003, primarily from higher capacity utilization related to the higher sales volume, cost reductions and favorable foreign exchange rates. Fourth quarter operating expenses increased 6.1%. Fourth quarter operating expenses reflect higher payroll and benefits from increased headcount to support sales and marketing activities and product development, including those related to RFID products, as well as higher

 



 

legal expenses related to litigation and increased work on intellectual property matters. Quarterly operating income increased 43.1% on margin expansion to 26.4% of net sales from 21.9% for the fourth quarter of 2003.

 

Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki